Pay With Square is a bit different than the original Square app
that lets you accept credit card payments on your smartphone or
tablet using a special dongle.

Instead, you input your credit card information into the app—just
like you would with Amazon or any other ecommerce site—and use your
phone to make payments. The app only works in stores that sign up
to take payments with Square. (Don't worry, the app will help you
find nearby locations that participate.)

When you walk into a store that accepts Pay With Square, you open
a tab with the app, or you can set it to automatically open a tab
whenever you walk in. The app then uses your phone's GPS and
alerts the cashier's computer that you're in the building. (The
cashier will also see your profile photo.)

When it comes time to pay, you just have to tell the cashier your
name and he or she will process the payment. You don't need to
show your phone or credit card.

Until now, Pay With Square was mostly used by smaller,
independently-owned stores. But with Starbucks on board, Square
will be in thousands of locations at a major retailer. That's a
big deal.

But there's a caveat. As Dan
Frommer reports, Starbucks will initially require you to show
a barcode on your phone to the cashier so he or she can scan it.
You won't be able to take advantage of the hands-free payments
that other Pay With Square partners allow. Yet.

That makes sense, because it's a huge, expensive ordeal for
Starbucks to rip out all of its point-of-sale systems and replace
them. The barcode system works with existing equipment.

So at the end of the day, paying with Square on your phone at
Starbucks will be a very similar experience as paying with the
official Starbucks app for now. The only difference is you can
use a real credit card, not a pre-loaded gift card.

But from the way the companies are talking, it seems clear that
will change as they figure out how to make Pay With Square's tab
feature work at Starbucks.

If you want to give it a try, you can download Pay With Square
for free on
Android and
iPhone.

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